September 24, 2025 a 12:47 pm
RCL: Dividend Analysis - Royal Caribbean Cruises Ltd.
Royal Caribbean Cruises Ltd. offers a notable dividend profile with a consistent history. Despite recent disruptions, the company shows commitment to its dividend policy. This analysis provides insights into the sustainability and growth potential of its dividends for investors seeking income.
📊 Overview
Royal Caribbean Cruises Ltd. operates in the Consumer Discretionary sector, providing passenger cruise services. Below is a summary of its current dividend metrics:
| Metric | Value |
|---|---|
| Sector | Consumer Discretionary |
| Dividend yield | 0.92% |
| Current dividend per share | 0.41 USD |
| Dividend history | 28 years |
| Last cut or suspension | 2020 |
🗣️ Dividend History
Understanding the historical pattern of dividend payments is essential for assessing the reliability and policy stability of the company. Below is an image showing historical dividend changes:
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 2.50 |
| 2024 | 0.95 |
| 2020 | 0.78 |
| 2019 | 2.96 |
| 2018 | 2.60 |
📈 Dividend Growth
The dividend growth rate is a critical indicator of a company’s ability to consistently increase dividends over time. A comparison of growth over different periods is provided:
| Time | Growth |
|---|---|
| 3 years | 6.79% |
| 5 years | -20.33% |
The average dividend growth is -20.33% over 5 years. This shows a recent concerning trend in dividend cuts.
🧮 Payout Ratio
The payout ratio illustrates the proportion of earnings a company pays as dividends to shareholders, indicating sustainability and capacity for future growth.
| Key figure | Ratio |
|---|---|
| EPS-based | 3.09% |
| Free cash flow-based | 3.10% |
With EPS-based and FCF-based payout ratios below industry norms, this suggests a conservative dividend policy, potentially ensuring stability or growth from current levels.
💰 Cashflow & Capital Efficiency
Assessing cash flow and capital efficiency is crucial for understanding the economic robustness and operational health of the company.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 3.31% | 1.75% | -17.68% |
| Earnings Yield | 4.78% | 5.12% | -17.10% |
| CAPEX to Operating Cash Flow | 62.07% | 87.04% | 563.41% |
| Stock-based Compensation to Revenue | 1.62% | 0.91% | 0.41% |
| Free Cash Flow / Operating Cash Flow Ratio | 37.93% | 12.96% | -463.41% |
The efficiency metrics show volatile cash flow performance, with recent trends indicating recovery yet highlighting the need for more sustainable operations.
📉 Balance Sheet & Leverage Analysis
Evaluating the balance sheet dynamics provides insights into financial stability, risk exposure, and the company’s ability to manage its debt.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 275.29% | 468.46% | 836.32% |
| Debt-to-Assets | 56.16% | 62.99% | 71.03% |
| Debt-to-Capital | 73.35% | 82.41% | 89.32% |
| Net Debt to EBITDA | 3.36 | 4.74 | 35.87 |
| Current Ratio | 0.17 | 0.19 | 0.37 |
| Quick Ratio | 0.15 | 0.16 | 0.35 |
| Financial Leverage | 490.15% | 743.67% | 1177.27% |
The balance sheet analysis reveals high leverage, suggesting potential financial vulnerabilities but also opportunities for leveraging assets during recovery periods.
💡 Fundamental Strength & Profitability
Core profitability and efficiency measurements are crucial for evaluating the enterprise’s ability to generate profits and shareholder returns.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 38.04% | 35.92% | -75.15% |
| Return on Assets | 7.76% | 4.83% | -6.38% |
| Margins: Net | 17.45% | 12.21% | -24.39% |
| EBIT Margin | 27.22% | 22.35% | -8.96% |
| EBITDA Margin | 36.92% | 32.81% | 6.96% |
| Gross Margin | 47.52% | 44.06% | 25.16% |
| Research & Development to Revenue | 0% | 0% | 0% |
The profitability metrics have improved, yet the underlying operational challenges continue, reflecting recovery within an uncertain external environment.
📊 Price Development
✅ Dividend Scoring System
An individualized dividend scoring system assesses varied aspects of the company's dividend policy and financial standing:
| Criteria | Score | |
|---|---|---|
| Dividend yield | 2 | |
| Dividend stability | 3 | |
| Dividend growth | 1 | |
| Payout ratio | 4 | |
| Financial stability | 2 | |
| Dividend continuity | 4 | |
| Cashflow Coverage | 2 | |
| Balance Sheet Quality | 2 |
Total Score: 20/40
🔥 Rating
Royal Caribbean Cruises Ltd. demonstrates resilience within a challenging market environment but also faces several structural and financial challenges. Investors should weigh the risks and potential returns carefully, considering both dividend prospects and broader financial metrics.